Thu
Nov 13 2025
01:51 pm
50 Year Mortgage Part II
By: bizgrrl

Did you know you pay approximately $281,516 in interest on a $300,000 30 year mortgage with 20% down and a 6.063 rate?

$1,702.66 Monthly payment, including property taxes and homeowners insurance.

Do you know you would pay approximately $524,736 in interest on a $300,000 50 year mortgage with 20% down and a 6.063 rate?

$1,528.56 Monthly payment, including property taxes and homeowners insurance.

Thus, you will pay an extra $243,220 interest on a $300,000 home if you elect to obtain a 50 year mortgage.

Your mortgage payment will only be $174.10 a month less.

Note, In general, shorter term loans have lower interest rates and lower overall costs. Thus, if you go with a longer term, e.g. 50 years over 30 years, then your interest could increase and you would pay more in total interest over the term of the loan.

Note: I used mortgage calculators from the internet to come up with these numbers. I used the Alcoa, TN zip code. I could be wrong.

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KevinMurphy's picture

renting from the bank

Submitted by KevinMurphy on Fri, 2025/11/14 - 7:59am.

I tried the figures for a 50 year mortgage, asking the question "how much equity will I have built up after 20 years?"

50 year mortgage on a 400,000 home with 20% down, 6.276% interest rate. No property taxes, homeowners, etc.

At the 20 year mark, you will have paid off $39,843 while paying $383,491 of interest to the bank.

Now you have locked in your base housing cost (without insurance, property taxes, etc) at $1,751/month for those 20 years, which is better than dealing with rent increases.

If your house value increases faster than that mortgage interest rate, yeah you'll end up net ahead if you sold at the 20 year mark. But looking at Knoxville's historic housing prices, no, our market has not increased 6% a year for the last 20 - it's been lower than that. Maybe we are normalizing more towards that after a really low-return decade (2008-2017 where we had years of negative value and no years above 5% increase in value).

The real winner is that bank, which made a reliable interest payment from you for those 20 years. You're really renting from a bank instead of a landlord if you're on a 50 year mortgage.

Up Goose Creek's picture

15 yr loan

Submitted by Up Goose Creek on Sat, 2025/11/15 - 9:31am.

I've said the secret to my success is the 15 yr loan. Because it's a forced savings account.
Since I liked to buy old houses it was good to have equity to tap into for repairs. But even a new house will need updates starting at 10-15 yrs.
The first mortgage I got from a credit union had a 12 yr amortization. Why? I made a chart one time and figured out principal payments didn't really accelerate until one was 12 years prior to payoff.

Too bad 20 yr mortgages aren't readily available. That seems like a good compromise to keep payments low. 50 yrs is just ridiculous.

jbr's picture

Homeownership used to start in your 20s. Now it starts...

Submitted by jbr on Sat, 2025/11/15 - 4:14pm.

Buying a home used to be a milestone of early adulthood. Now the median first-time buyer is 40.

Homeownership used to start in your 20s. Now it starts closer to retirement. What happened?

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